It's about Time : The Competitive Advantage of Quick Response Manufacturing

by Suri; Rajan

• ISBN13: 9781439805954
• ISBN10: 1439805954
• Format: Hardcover
• Copyright: 2010-01-01
• Publisher: CRC

Summary

While everyone knows that time is money, this book demonstrates that for manufacturing companies time is a lot more money than most managers realize! The author shows how companies can take advantage of this realization to gain competitive advantage. This book is intended to be a quick read to convince executives to implement QRM strategy as well as a brief overview for all employees to help them support the QRM implementation.In the decade since the publication of Rajan Suri's landmark book, Quick Response Manufacturing , the innovative principles of QRM have been proven out via impressive results at many companies, big and small, in a variety of industries. While the key principles of QRM remain unchanged, after a decade of teaching QRM workshops to senior executives, Suri has developed a concise yet convincing way of presenting QRM strategy using four core concepts: (i) The Power of Time ' the huge impact that time has on your whole enterprise (ii) Organization Structure ' how to structure your organization to minimize time (iii) System Dynamics ' understanding how interactions between jobs and resources impact time and thereby how to make better decisions on capacity, lot sizes. and similar issues (iv) Enterprise-wide application - QRM is not just a shop floor strategy, it extends across your whole enterprise including material planning and control, supply management, office operations and new product introduction.The text contains new case studies on QRM implementation showing how QRM not only reduces lead time but also improves quality, reduces total operating cost, and enables companies to gain substantial market share. The book also shows how factories in advanced nations can use QRM strategy to compete with manufacturers in low-wage countries. An additional chapter provides pointers for QRM implementation including accounting strategies, novel cost-justification approaches, and a stepwise process for implementation.Also included is a bonus CD with five appendices that provide a number of practical details to assist in the success of your QRM implementation. Suri chose the topics for the appendices based on numerous experiences with companies, picking topics that most frequently needed to be addressed during the implementation. When you are ready to start implementing QRM, you will find that these appendices contain many tips and pointers that help you work through implementation questions, and also provide simple calculation methods and tools to support the design of your QRM strategy.

Table of Contents

Contents of Bonus CD	p. xiii
Acknowledgments	p. xv
Introduction	p. xvii
The Power of Time	p. 1
Defining QRM	p. 2
Challenges to Reducing Lead Time	p. 4
QRM Focus Is Different from a Traditional Approach	p. 8
Manufacturing Critical-path Time (MCT)	p. 12
Keep Data-Gathering Efforts Simple	p. 12
Measure in Calendar Time and Properly Quantify the Critical Path	p. 13
An MCT Example	p. 14
Impact of MCT on Your Organization's Performance	p. 18
Enterprise-Wide Waste Due to Long MCT	p. 20
Impact of QRM-Standard Cost Prediction versus Actual Results	p. 23
Accounting Systems Miss the Connection	p. 25
Encouraging Time-Based Thinking throughout the Organization	p. 28
Rethinking the "On-Time Delivery" Metric	p. 30
Dysfunctional Impact of the On-Time Delivery Metric	p. 31
The QRM Approach to Improving Delivery Performance	p. 33
Squeezing Out Time Leads to Numerous Improvements	p. 33
Organizational Structure for Quick Response: QRM Cells, Teamwork, and Ownership	p. 35
Response Time Spirals	p. 36
The Spiral for a Make-to-Stock Business	p. 36
The Spiral for a Make-to-Order Business	p. 39
Roots of the Response Time Spirals	p. 41
Four Structural Changes for Quick Response	p. 47
Organize into QRM Cells	p. 48
Understanding Focused Target Market Segment (FTMS) through an Example	p. 48
Defining a QRM Cell	p. 50
Deciding Which Resources to Include in a QRM Cell: An Example	p. 52
QRM Cells Are More Flexible than Traditional Cells	p. 53
Team Ownership	p. 56
Significant Investment in Cross-Training	p. 57
Relentless Focus on MCT Reduction	p. 60
Understanding the QRM Number	p. 60
Ensuring Proper Application of the QRM Number	p. 63
Harnessing the Power of the Four Structural Keys	p. 65
Understanding and Exploiting System Dynamics Principles	p. 71
The Parable of the Landing Gear	p. 73
The Pitfall of High Utilization	p. 75
Understanding the Magnifying Effect of Utilization	p. 76
Clarifying "Utilization"	p. 77
Clarifying "Flow Time"	p. 78
Putting It All Together	p. 79
The Miraculous Effect of Spare Capacity	p. 80
Impact of Variability	p. 81
Three-Pronged Strategy to Reduce Flow Time	p. 83
Reduce AV, the Average Variability	p. 83
Practical Strategies for Reducing Variability in Arrivals	p. 84
Practical Strategies for Reducing Variability in Job Times	p. 84
Reduce M, the Magnifying Effect of Utilization	p. 85
Reduce TJ, the Time per Job	p. 87
Combined Impact of Strategies to Reduce Flow Time	p. 87
Time-Based Approach to Batch Sizing	p. 89
Setup Reduction-Insights from System Dynamics	p. 94
Reexamining Organizational Policies to Support Batch Size Reduction	p. 96
QRM Approach to Transfer Batching	p. 98
System Dynamics Compared with MRP, EOQ, and Other Traditional Approaches	p. 99
Why Companies Mistakenly Invest in Warehouses Instead of Machines	p. 102
A Unified Strategy for the Whole Enterprise	p. 105
Principles of Quick Response in Office Operations	p. 106
The Response Time Spiral in Office Operations	p. 106
Eliminating the Response Time Spiral in Office Operations	p. 109
How to Identify an FTMS in the Context of Office Operations	p. 112
How to Form Effective Q-ROCs	p. 114
The FTMS and Q-ROC Reinforce Each Other and Provide the Basis for Rethinking Processes	p. 115
Combine Steps	p. 115
Eliminate Steps	p. 116
Redesign Steps	p. 117
Provide Continuous Flow of Work	p. 118
Take Advantage of the Latest Information Technology and Tools	p. 118
Overcome Traditional Mind-Sets	p. 119
Additional Challenges in Reorganizing Office Operations	p. 120
A Case Study: Q-ROCs Rock at Alexandria Extrusion Company	p. 122
Restructure Your Material-Planning System to Support QRM	p. 123
Implementing High-Level MRP	p. 125
Understanding Why HL/MRP Will Work Better than Standard MRP	p. 127
POLCA-The Shop Floor Material Control Strategy to Support QRM	p. 129
Why Kanban (Pull) Won't Work in the QRM Context	p. 130
Takt Time Issues	p. 130
Pull System Issues	p. 131
Difficulties with Custom or New Products	p. 132
Paired-cell Loops of Cards	p. 133
Authorization	p. 134
Dispatch List	p. 134
Strict Scheduling Rules	p. 136
Overlapping Loops	p. 138
Benefits Realized with POLCA Implementations	p. 139
Transforming Your Purchasing Using Time-Based Supply Management	p. 142
The Response Time Spiral in Purchasing	p. 142
Impact of Supplier with Long MCT	p. 144
Deficiencies of Traditional Supply Management Metrics	p. 146
Use MCT as a Primary Metric for Suppliers	p. 147
Encourage Your Suppliers to Reduce MCT	p. 148
Time-Based Dual Sourcing for Overseas Suppliers	p. 149
Strategies for Low-Volume Parts	p. 151
Supplement Time-Based Strategies with Other Modern Practices	p. 152
Train Your Supply Management Personnel and Rethink Performance Metrics	p. 153
Customer Strategies to Support Your QRM Program	p. 153
Get Your Sales Force to Exploit Your QRM Capabilities	p. 155
Time-Based Mind-Set for New-Product Introduction	p. 156
Benefits of Rapid New-Product Introduction	p. 156
Rethinking Cost-Based Decisions for New-Product Introduction	p. 159
Implement a New Purchasing Paradigm for Prototype Construction	p. 159
Identify Long-Lead-Time Components Ahead of Time	p. 160
Use Product Enrichment Strategy	p. 161
Summary and Next Steps	p. 162
A Road Map for QRM Implementation	p. 163
"Power of Six" Rule for Cost Impact of QRM	p. 165
Mind-Set First, Technology Later	p. 168
Embarking on Your QRM Journey	p. 170
Highlight the Power of Time for Your Organization	p. 170
Create the Right Organizational Structure	p. 171
Understand and Exploit System Dynamics	p. 172
Build Your Enterprise-Wide, Unified Strategy	p. 172
Switch to Time-Based Cost Justification of QRM Projects	p. 173
Use Accounting Strategies to Support QRM	p. 180
Use Lower Overhead Rates for Cells	p. 181
Assign Overhead Using More than Just Direct Labor	p. 183
Apply Overhead at the Time of Shipment	p. 186
Apply Overhead Based on MCT or Other Lead Time Measure	p. 186
Reassign Some of the Overhead Costs Specifically to Large Batches	p. 187
Combine Approaches for Better Results	p. 188
Recognize That Your Existing Improvement Strategies Strengthen Your QRM Program	p. 188
Use QRM as a Positive, Unifying Perspective for Your Entire Business	p. 190
Index	p. 193
About the Author	p. 209
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